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Texxi is a company that aims to facilitate taxi sharing by acting as a "broker" between taxis and passengers in a number of different settings (e.g. "evening economy", commute, school run, etc). Its founder, Eric Masaba, calls this concept 'Demand Responsive Transit Exchange'. Very simply by sharing taxis, the taxi driver earns more and passengers pay less.
This is how it works for passengers. Passengers text a taxi request stating their destination postcode and are matched with others wanting a similar ride at a similar time. Passengers can register with Texxi and form 'social networks' for taxi sharing. Texxi texts a confirmation and pick up point, which the potential passenger then confirms by text.
Eric Masaba devised the 'texxi' concept, while working as a hedge fund manager in the US and becoming frustrated with his experiences of travelling to work by taxi.
Eric describes himself as a libertarian, believing people should have freedom of choice without government interference. Therefore, if shared taxis tempt some people away from public transport, it is the job of PT services to adjust in order to compete (the reasoning being that an empty bus providing a service which no one wants is not environmentally friendly anyway)
Eric’s background is in finance; before starting up Texxi he worked for a hedge fund company in Connecticut, becoming interested in social networks in the finance sector and developing mathematical algorithms to describe them. Not being allowed a US driving licence, and depending on expensive taxi journeys to get to work, he made the comparison between financial networks and transport networks, and came up with the shared taxi idea. Eric calculated the potential size of the market and concluded that this was a major business opportunity which also offered environmental benefits.
He wrote the business plan and got the first investors on board in 2004, and Texxi was incorporated in March 2005. The intellectual property for SMS-based taxi-sharing is held separate from the company, and is handled by Crane Dragon. Around 40 people are now involved in the company.
It was important to map demand before launching the first pilot. Eric chose Liverpool because this is his home town, and because it has a high density of taxis (22,000 for 500,000 inhabitants). Culturally and socially, Liverpool is one on its own, although it has some similarities with Newcastle. The night club market (“evening economy”) was chosen for the first pilot because young people use SMS as second nature (unlike older people : “people over 40 don’t know how to text”!). Taxi drivers were paid by Texxi as a loss leader when they did not have a full cab, in order to provide “liquidity”.
The Liverpool pilot has now been concluded. What lessons were learned from it?
• The only effective form of marketing was active face-to-face promotion by attractive, outgoing young women in the night clubs (but not too attractive, as this seemed to put off both men and women!).
• Billboard advertising was expensive and ineffective; radio advertising raised awareness after prolonged exposure, but was not enough to motivate people actually to use Texxi. “Viral marketing” was used through the diffusion of video adverts (made by the Pirelli man) through online social networks (NB how effective was this?).
• The biggest, and largely unanticipated problem, was that clubbers were often too drunk to be able to text, or had run out of credit on their phones by the end of the night. This often meant that the marketing staff had to arrange the taxi share for them as they came out of the clubs, otherwise they would not have been able to use it. For similar reasons, the young people often found the Texxi groups service too difficult to organise. By the next day they often couldn’t remember using Texxi at all, which limited the extent of word-of-mouth diffusion. The best Texxi clients were “middle class girls, who get less drunk”.
• Eric still regards the social networks aspect of Texxi to be crucial to its success, but acknowledges the importance of understanding the cultural and social context of each specific market.
The next pilot was on the Isle of Wight over Christmas 2007, again within the context of the “evening economy”. After that Eric is keen to test it on the commuter market (in Brisbane?), but also believes it holds huge potential for “big events”, tourism and the school run. He is also interested in testing the idea of shared private jets (i.e. filling seats on otherwise empty return legs). He is marketing the idea internationally, having just spent 5 months in Asia. Sweden is one of the countries which is particularly interested in DRT because of its low population density. Prague already has a text-based taxi system, although this is not a shared taxi scheme.
Better personal safety is an important aspect of Texxi (particularly for the night club market), as there is a record of every driver and where he/she is going. In the pilot, some people asked to be dropped off a short distance from their homes, so other passengers wouldn’t know where they lived.
NB. Taxi sharing is not a new social practice. People in long taxi queues routinely organise themselves to share, whilst shared taxis have long been the norm in many countries (e.g. the dolmus in Turkey). The novelty is the harnessing of a recent technology (SMS) to facilitate the organisation of taxi-sharing, but this can only succeed if there is an understanding of the extent to which text messaging is socially embedded within the target social groups.